03/01/2011

Should you pull money out of your 401k?

If you owe a bunch of money to credit card companies and need relief, you may be eyeing your 401k. Bad idea; you’ll pay income tax on the withdrawal, which could put you in a higher tax bracket. You’ll also have to pay a 10% penalty and you must stop making contributions to the account for six months, which means you won’t get your companies matching money. Without much effort ,you will lose half or nearly half of the withdrawal. Want to see how the numbers add up for you?

You’ll also have to pay a 10% penalty and you must stop making contributions to the account for six months, which means you won’t get your companies matching money. Without much effort ,you will lose half or nearly half of the withdrawal. Want to see how the numbers add up for you?